OCC Adopts Final Rule Requiring Large Banks to Provide Fair Access to Banking Services
JACKSONVILLE, FL, January 20, 2021 – The National ATM Council, Inc. (“NAC”), the U.S. trade association representing the Independent/Retail ATM industry, commends the Office of the Comptroller of the Currency (OCC) for adopting a new federal rule aimed at ensuring the provision of fair access to banking services by large national banks, federal savings associations, and federal branches and agencies of foreign bank organizations.
“We are hopeful this new OCC rule will bring an end to the current nationwide denial to independent ATM providers of fair and reasonable access to the very same business banking services and accounts otherwise enjoyed by all lawful businesses in the U.S.,” said NAC Executive Director Bruce Renard.
ATM deployers must be able to maintain at least one bank account for the “vault cash” that is loaded into and dispensed from their ATMs. After those funds have been dispensed to ATM customers, they then are replenished electronically with funds transmitted from the withdrawing cardholders’ bank accounts to the ATM deployer’s account, via the U.S. banking system’s financial settlements process. Thus, unless the ATM deployer has a bank account from which to obtain its ATM vault cash and receive return electronic transmissions of those funds, it cannot operate its business. Every ATM business must be sponsored by a bank before being allowed to become a member of the regional and global financial networks through which all ATM transactions are conducted.
Yet far too many of these small-business ATM entrepreneurs are currently unable to obtain or maintain bank accounts with any major national bank in the U.S. These banks account for the largest share of the U.S. bank offices where ATM companies historically have held their ATM vault cash. But businesses in the independent ATM industry now are universally refused accounts because all the big banks have misclassified ATM entrepreneurs as “high-risk” businesses, simply because ATM deployers are “cash-intensive” by nature. However, while they deny banking services to all competitive ATM providers, these very same banks also operate very large “cash-intensive” ATM fleets of their own and charge their cardholders costly “disloyalty fees” each time they use an ATM not owned by their bank.
“The current denial of ATM company accounts by major banks in America is a perfect example of how our banking system went awry in the wake of Operation Choke Point and beyond, cutting off lawful ATM businesses from the banking system for no valid reason whatsoever,” said NAC Chair and Access One CEO George Sarantopoulos. “Regardless of whether the conduct of these banks is based upon anticompetitive or other self-serving motives, misguided federal banking regulation, or some mix of the two, the end result remains the same. Legitimate ATM companies are being denied the basic business banking services that are essential to their businesses. We thank the OCC for taking action to address this important issue for America’s ATM deployers, and to ensure compliance with federal law on the part of our nation’s largest banks.”
Independent ATMs account for almost sixty percent of all the ATMs deployed today in America. These entrepreneurial ATMs have become key to making convenient and widespread cash access a reality throughout our nation. Recognized as “Essential Businesses” by the U.S. Department of Homeland Security, Independent ATMs also continue to play an instrumental role in distributing COVID-19 recovery funds and unemployment insurance payments to the tens of millions of Americans hit hardest by our current national pandemic. Studies have shown that Independent ATMs are virtually the only terminals that serve lower-income inner-city neighborhoods and rural communities throughout the nation where there are no banks or bank provided ATMs, and that otherwise would be “cash deserts.”
The newly adopted OCC rule is scheduled to become effective April 1, 2021.
The National ATM Council, Inc. is a not-for-profit national trade association dedicated to ethically and effectively representing the business interests of ATM Owners, Operators and Suppliers in their efforts to provide safe, secure and convenient delivery of cash to consumers throughout the United States. https://www.natmc.org/